Polski Holding Nieruchomości S.A.

Share Issue/Capital Change • Jun 22, 2016

Current report No. 17/2016 of June 22, 2016

Concluding significant agreements resulting in selling assets ofsignificant value between the Issuer's subsidiaries

Legal basis: Article 56.1.2 of the Act on Public Offering - currentand periodical information

The Management Board of Polski Holding Nieruchomości S.A. ("PHN" or the"Issuer") hereby informs that companies belonging to the Issuer's Group- Warszawski Holding Nieruchomości S.A. ("WHN"), PHN SPV 33 Sp. z o.o.("SPV 33"), Cuatro Sp. z o.o. ("Cuatro"), all based in Warsaw, andDalmor S.A. ("Dalmor") based in Gdynia - concluded significantagreements resulting in the sale by WHN, Dalmor and SPV 33, and purchaseby Cuatro, of shares in PHN 6 Sp. z o.o. based in Warsaw ("PHN 6") heldby WHN, Dalmor and SPV 33.

By resolution of the Extraordinary General Meeting of Cuatro of June 21,2016, the share capital of Cuatro was increased from PLN 55,000.00 toPLN 981,971,450.00 by creating 19,638,329 new shares with a nominalvalue of PLN 50.00 each, i.e. with a total nominal value of PLN981,916,450,00, taken up by WHN against: in-kind contribution ("In-KindContribution 1") in the form of 26,739 ordinary shares in PHN 6, held byWHN, with a nominal value of PLN 50.00, constituting 76.77% of PHN 6share capital and giving right to 76.77% votes at the General Meeting ofPHN 6, whose fair value has been established at a total of PLN981,916,434.90, and a supplementary financial contribution of PLN 15.10.As part of performing WHN's obligation to make a contribution to covernew shares in Cuatro's share capital, on June 21, 2016, WHN and Cuatroconcluded an agreement transferring the shares constituting the In-KindContribution onto Cuatro ("In-Kind Contribution Agreement 1"). Ownershipof shares constituting In-Kind Contribution was transferred onto Cuatroupon signing the In-Kind Contribution Agreement.

By resolution of the Extraordinary General Meeting of Shareholders ofCuatro of June 22, 2016, the share capital was increased again from PLN981,971,450.00 (taking into consideration the share capital increasemade on June 21, 2016, although it has not been registered) to PLN1,279,128,050.00 by creating 5,943,132 new shares with a nominal valueof PLN 50.00 each, i.e. with a total nominal value of PLN297,156,600.00, taken up by: (i) Dalmor against in-kind contribution("In-Kind Contribution 2") in the form of 3,471 ordinary shares in PHN6, held by Dalmor, with a nominal value of PLN 50.00 each, constituting9.96% of PHN 6 share capital and giving right to 9.96% votes at theGeneral Meeting of PHN 6, whose fair value has been established at atotal of PLN 127,462,954.69, and a supplementary financial contributionof PLN 45.31; (ii) SPV33 against in-kind contribution ("In-KindContribution 3") in the form of 4,621 ordinary shares in PHN 6, held bySPV33, with a nominal value of PLN 50.00 each, constituting 13,27% ofPHN 6 share capital and giving right to 13,27% votes at the GeneralMeeting of PHN 6, whose fair value has been established at a total ofPLN 169,693,550.46, and a supplementary financial contribution of PLN49.54.

As part of performing the obligation of Dalmor and SPV 33 to makein-kind contribution to cover new shares in Cuatro's share capital, onJune 22, 2016, Dalmor, SPV 33 and Cuatro signed agreements transferringthe In-Kind Contribution onto Cuatro ("In-Kind Contribution Agreement 2"for Dalmor and "In-Kind Contribution Agreement 3" for SPV 33). Ownershipof shares constituting In-Kind Contribution 2 and 3 was transferred ontoCuatro upon signing In-Kind Contribution Agreements 2 and 3.

As a result of performing In-Kind Contribution Agreements 1, 2 and 3,the ownership of all PHN 6 shares was transferred onto Cuatro.

Shares in PHN 6 held by WHN, Dalmor and SPV 33 constituted long-terminvestment, and contributing them to Cuatro as an in-kind contributionis an element of PHN Group's strategy, consisting in changing theGroup's structure in order to improve its operational effectiveness.

Before increasing Cuatro's share capital, WHN held 100% of shares andvoting rights at the General Meeting of Shareholders of that company.After registering the share capital increase, the shareholding andvoting rights structure at the General Meeting of Shareholders of Cuatrowill be as follows: WHN 76.77%, Dalmor 9.96%, SPV 33 13.27%.

Before the transaction, the shareholding and voting rights structure atthe General Meeting of Shareholders of PHN 6 was as follows: WHN 76.77%,Dalmor 9.96%, SPV 33 13.27%; after performing and registering thetransaction, Cuatro holds 100% of shares and voting right at the GeneralMeeting of Shareholders of PHN 6.

WHN has 90.31% of shares and voting rights at the General Meeting ofShareholders of Dalmor.

The Issuer has 97.89% of shares and voting rights at the General Meetingof Shareholders of WHN, and 100% of shares and voting rights at theGeneral Meeting of Shareholders of SPV 33.

The value of the In-Kind Contribution and the price of shares in theincreased share capital of Cuatro 5 taken up in exchange for thatIn-Kind Contribution exceeds 10% of the Issuer's equity, so it meets thecriterion of assets of significant value.

Legal basis: Article 5.1.1 and 5.1.3 in relation with Article 7 and 9of the Regulation of Minister of Finance of February 19, 2009 on currentand periodical information published by issuers of securities and theconditions of recognizing information required by the regulations ofnon-member states as equivalent (Journal of Laws 2009 No. 33, item 259,as amended).